Canadian tax implications for transferring ownership of a company to spouse?

This question is a question for interest. I currently own a business, and my spouse does some part time work for the company as a human relations manager and receives a directors fee. I want to involve my spouse in ownership of the business, and was wondering what the canadian tax implications would be for transferring the ownership (attribution, income splitting, etc)?Canadian tax implications for transferring ownership of a company to spouse?
The answer is complicated because you are operating the business through a corporation.





You may be able to give your husband shares of the corporation on a tax-free basis. It would depend on how the transaction was structured.





You may avoid attribution if you paid your husband as an employee rather than a director. However, this may not achieve your income splitting needs.





Given the complexity of the issue, you should seek a tax professional (lawyer or accountant).Canadian tax implications for transferring ownership of a company to spouse?
There is no income splitting except for qualified pension income.


The attribution rules state that when a property is transferred to a spouse the income produced by the property(business) is considered to be that of the transferor, unless a loan was granted for the fair market value of the business in which case the interest paid to the tranferor must be reported as income and must also be at least at the prescribed rate of interest.